​A flux economic environment

ARGENTINA - Report 07 Mar 2020 by Esteban Fernandez Medrano

In this report, we are going to review some of the primary political expressions of the last weeks, such as President Alberto Fernández's (AF) statements to Congress during the opening of this year's ordinary sessions and Martin Guzman economic presentation, also made to Congress. The aim is to have a better understanding of the political and economic stance of the new government. In particular, to understand what to expect from sensitive economic topics, such as the starting debt restructuring. The government is simultaneously advancing with negotiations with the IMF and preparing the ground to present the restructuring proposal to investors. The announcement of Lazard as financial advisor to the restructuring (as in 2005) and Bank of America and HSBC as Placement Agents sets the debt swap officially in motion.

Although local media published that the government allegedly started to share some of its restructuring proposals with the placement agents, for the time being, the government has been cautious not to show his hand. Still, we expect the offer to become public in the next week or two.

Finally, in this report, we revise some of the latest macroeconomic indicators to analyze the state of the economy at which the current administration took power. Generally speaking, weak activity data, combines with an incipient drop in inflation, despite an expansionary monetary policy, while the official real FX rate continues to appreciate. The combination of a weak macro outlook, a significant change in policy orientation, and the uncertainty regarding the outcome of the debt restructuring, defines the current economic state as being in a flux.

In the next sections, we will review the main political statements, chronologically, starting with MG´s presentation following with AF’s. We would have expected that the minister´s speech would have been more concrete and down to earth than the political address of the president, but in the end, it was the other way around. In the appendix, you will find a summary of the importat aspects of both speeches.

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This report is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This report is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this report or its contents.